• Searchblog, Thursday, May 29, 2008 12:45 PM

John Battelle recaps Kara Swisher and Walt Mossberg's conversation with Yahoo top brass Jerry Yang and Sue Decker at the D Conference. Yang and Decker are as frank as they can be about the Microhoo implosion, the search race, employee morale and how they're dealing with the shareholder turmoil.

"Over the last two years we've closed the gap against Google by quite a bit," Yang said, speaking about bid prices on Yahoo's Panama platform. "Now we've shifted our focus back to driving query growth, which is growing on an absolute basis." He acknowledged that Yahoo was second fiddle to Google, but countered by saying the battle was about "innovation and differentiation," "becoming more open as a search platform," and being "more aggressive."

As for the perception of chaos in Sunnyvale, Decker said that Yahoo managed to hire 600 people amidst the turmoil--and that the product pipeline (including Search Monkey, Glue Pages and the acquisition of Web analytics provider IndexTools) was indicative of the company's health. "We have the chance of a lifetime to show what Yahoo can do," she said, and added that all the opposition had served as a great unifier.

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